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Let’s Talk About… Gender Pay Gap Reporting

Lisa Bryson

Eversheds Sutherland

Overview

I have been asked on several occasions recently about the status of the gender pay gap reporting obligations in Northern Ireland. In short, the gender pay gap reporting obligations which were introduced in Great Britain this year have not been introduced in Northern Ireland to date. However, the Employment Act (Northern Ireland) 2016, which has not yet been implemented, contains some similar provisions to those in place around gender pay gap reporting. Although the enabling regulations have not yet been published and we do not have a lot of detail around what to expect, we do know that the obligations in relation to pay reporting in Northern Ireland, when introduced, will go further and will have more ‘bite’ than those in Great Britain.

What is the position in Great Britain?

The Equality Act 2010 introduced gender pay gap reporting obligations for employers with more than 250 employees for the public and private sectors in March and April 2017 respectively.

What is the position in Northern Ireland?

Article 19 of the Employment Act (Northern Ireland) 2016 (the “Act”) stipulates that regulations should be put in place to address pay gap reporting requirements. This provision in the Act has not yet been brought into force, and draft regulations have not yet been published – all further casualties of the impasse at Stormont.

What we do know however is that there are a number of striking differences between the wording in the Act and the gender pay gap reporting provisions in place in GB. It is true to say that the Northern Ireland provisions when they are introduced go further than those in GB and have a lot more sting in the tail for non-compliance. I should also mention that we do not know whether the regulations in Northern Ireland will also limit the reporting threshold to employers with 250+ employees or whether it will be at a lower threshold. I would hedge a bet that the threshold in Northern Ireland will be lower and, as such, this is not something that the majority of employers in Northern Ireland can simply ignore.

What are the key differences?

Enhanced reporting obligations

In addition to requiring employers to report information about differences in pay between men and women, the Act in Northern Ireland sets out a requirement for employers to provide information on workers within each pay band in relation to ethnicity and disability. This level of reporting is not required in Great Britain.

Mandatory obligations to produce an action plan

The Act also goes one-step further in terms of action plans than its counterpart in GB. It states that where there are differences in pay between male and female employees, an employer must publish an action plan to eliminate those differences and must send a copy of the action plan to all employees and to any recognised Trade Union.

Penalties for non-compliance

It could be said that it is the enforcement provisions in the Act that provide the ‘stick’ with which to encourage employers to comply. They say that the regulations when implemented “shall” make provision for a failure to comply with regulations as an offence punishable on summary conviction by a fine not exceeding level 5 (£5,000) for every employee. With the potential fine being £5,000 in relation to every employee, this could result in a hefty fine indeed and certainly should hold the key to ensuring that compliance with these obligations is front and centre of an employer’s ‘to-do’ list. Even if the threshold in Northern Ireland was set at between 50 and 100 employees then the potential bill for non-compliance could be £250,000 to £500,000.

Can employers do anything proactively now?

If possible, yes. This said we do not yet know how the regulations will define ‘ethnicity’ or ‘disability’ for the purposes of this reporting so the steps that can be taken may be limited at this time. Employers would be prudent, however, to consider the level of internal information that you have in relation to pay grades and bands, and the information you hold in relation to the composition of the workforce by reference to gender, ethnicity and disability. Undertaking an internal review and audit may also enable you to identify and put in place some steps to iron out any current or historical pay gaps in advance of the regulations being introduced in Northern Ireland.

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Lisa is an experienced employment lawyer with over 15 years’ experience in employment and equality law. She will be presenting her session, ‘A Solicitor’s Guide to NI Employment Tribunals’at this year’s Annual Review of Employment Law conference:

No organisation ever wants to be on the receiving end of an Employment Tribunal claim. If a claim is received it typically falls to the HR manager to carry the load in terms of engaging with the external legal advisor and managing the ‘in-house’ preparations for the Tribunal hearing, not to mention having the prospect of giving evidence at the Tribunal hearing also hanging over you. Lisa Bryson, Principal Associate, Eversheds Sutherland will lighten the load for you at this session by demystifying the Tribunal process in Northern Ireland, identifying the key steps in the Tribunal process (and what HR needs to do in relation to each) and providing some practical considerations and tips for you should you be required to give evidence at a Tribunal hearing. Lisa will also address the anticipated changes to the Tribunal Rules in Northern Ireland at this session.

Disclaimer:

The information in this article is provided as part of Legal-Island's Employment Law Hub. We regret we are not able to respond to requests for specific legal or HR queries and recommend that professional advice is obtained before relying on information supplied anywhere within this article.